Real Estate Development in China’s Third Tier Cities

Research Article
Open access

Real Estate Development in China’s Third Tier Cities

Kangjie Shi 1*
  • 1 Tai Yuan University of Technology    
  • *corresponding author shikangjie0206@163.com
Published on 13 September 2023 | https://doi.org/10.54254/2754-1169/18/20230102
AEMPS Vol.18
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-915371-79-9
ISBN (Online): 978-1-915371-80-5

Abstract

The development of real estate in China is undergoing a difficult time. Development in the third tier cities is at a high rate, yet there is little or no population growth in these cities. Instead, the people are moving from these cities to others, creating a fall in the price of housing. The challenges have been occasioned by the free market in which the firms are operating, even though 60% of Chinese GDP is from these cities. It means that they are important, and there is a need to ensure that they are well regulated to create sustainability. The study used a document analysis method to collect the data. The researcher examined the different papers and documents which have been published on the subject of real estate development in China’s third-tier cities. Thereafter, a critical analysis was conducted to make sense of the data and information collected. In the following sections, this paper will discuss the current state of real estate and the potential impact of the overdevelopment in China’s third tier cities. This paper notes that tier-three cities are overdeveloped, yet the population is lower than what the real estate sector supplies. This means that the sector is in deep debt, an issue that can and should be avoided. In the meanwhile, the relevant recommendations will be given. Some of the recommendations include the following: Formulating appropriate policies to ensure that there is clear regulation for investors in the real estate industry in China; The government should take an active role in the real estate sector in China; The government needs to ensure that there is little mass flow of people from third tier cities by ensuring that there are incentives to make people stay in the cities.

Keywords:

real estate industry, China’s third-tier cities, housing prices, overdevelopment

Shi,K. (2023). Real Estate Development in China’s Third Tier Cities. Advances in Economics, Management and Political Sciences,18,375-379.
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References

[1]. Alli, K.L., Ramirez, G.G. and Yung, K. (1991). Corporate headquarters relocation: evidence from the capital markets, Journal of the American Real Estate and Urban Economics Association, Vol. 19 No. 4, pp. 583-99

[2]. Anderlini, J. (2009). Growing signs of Chinese recovery. The Financial Times, April 13, 2009. Available at http://www.ft.com/cms/s/0/93ebd99c-284d-11de-8dbf-00144feabdc0,dwp_uuid=9c33700c-4c86-11da-89df-0000779e2340.html

[3]. Chan, K., H. Fung, and Q. Liu. (2007). China’s Capital Markets: Challenges from WTO Membership. London: Edward Elgar Publishing, ISBN: 9781845426569

[4]. Archer, W. and Smith, M.T. (2004). Office buildings and the role of downtown in the polycentric city. Real Estate Issues, pp. 1-6

[5]. Chan, K., H. Fung, and Q. Liu, (2007). China’s Capital Markets: Challenges from WTO Membership. London: Edward Elgar Publishing

[6]. De Magalhaes, C. (2018). Economic instability, structural change, and the property markets: the late-1980s office boom in Sao Paulo. Journal of Environment and Planning Assessment, Vol. 30, pp. 2005-2024

[7]. Sakashita, A., H. Park, and T. Ichiki. (2006). The change of agricultural production system and land problems in the Sunan area of China: A follow-up research of Kaixiangong village. Review of Agricultural Economics, 62: 15-24.

[8]. Cheng, H. (2009). Institutions forecast continued recovery of the real estate market. Financial Net (in Chinese), March 23, 2009. Available at http://www.caijing.com.cn/2009-03-23/110126956.html

[9]. The Economist. (2007). Chinese Consumption. Available at http://www.economist.com/finance/displaystory.cfm?story_id=8746393. February 22nd, 2007 issue of the Economist magazine

[10]. Luo, Y. (2007). (ed.), China Industrial Map Editorial Committee, the China Economic Monitoring and Analysis Center of the National Bureau of Statistics, and Shanghai Yiju Real Estate Research Institute, The Industrial Map of China Real Estate. Social Sciences Academic Press: Beijing, China.

[11]. Fung, H., and Q. Liu. (2005). China’s Financial Reform in Banking and Securities Markets. Book chapter in China and the Challenge of Economic Globalization: The Impact of WTO Membership, pp. 145-163. New York, New York: M.E. Sharpe, ISBN: 0765614685.

[12]. Hang, X. L., Y. T. Huang, and H. Lan. (2008). A housing sale impasse for foreign institutions. First Financial Daily (in Chinese), October 23, 2008. Available at http://www.douban.com/group/topic/4461518/

[13]. Fung, H., A. Huang, Q. Liu, and M. Shen. (2006). The Development of the Real Estate Industry in China. Chinese Economy, Volume 39, Issue 1: 84-102.

[14]. Batson, A. (2009). China turns a corner as spending takes hold. Wall Street Journal, April 11, 2009, Page A1.

[15]. Feng, X. (2008). China’s Road to Good Housing. Shanghai Far East Publishing House: Shanghai, China.

Cite this article

Shi,K. (2023). Real Estate Development in China’s Third Tier Cities. Advances in Economics, Management and Political Sciences,18,375-379.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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About volume

Volume title: Proceedings of the 2023 International Conference on Management Research and Economic Development

ISBN：978-1-915371-79-9(Print) / 978-1-915371-80-5(Online)
Editor：Canh Thien Dang, Javier Cifuentes-Faura
Conference website: https://2023.icmred.org/
Conference date: 28 April 2023
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.18
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. Alli, K.L., Ramirez, G.G. and Yung, K. (1991). Corporate headquarters relocation: evidence from the capital markets, Journal of the American Real Estate and Urban Economics Association, Vol. 19 No. 4, pp. 583-99

[2]. Anderlini, J. (2009). Growing signs of Chinese recovery. The Financial Times, April 13, 2009. Available at http://www.ft.com/cms/s/0/93ebd99c-284d-11de-8dbf-00144feabdc0,dwp_uuid=9c33700c-4c86-11da-89df-0000779e2340.html

[3]. Chan, K., H. Fung, and Q. Liu. (2007). China’s Capital Markets: Challenges from WTO Membership. London: Edward Elgar Publishing, ISBN: 9781845426569

[4]. Archer, W. and Smith, M.T. (2004). Office buildings and the role of downtown in the polycentric city. Real Estate Issues, pp. 1-6

[5]. Chan, K., H. Fung, and Q. Liu, (2007). China’s Capital Markets: Challenges from WTO Membership. London: Edward Elgar Publishing

[6]. De Magalhaes, C. (2018). Economic instability, structural change, and the property markets: the late-1980s office boom in Sao Paulo. Journal of Environment and Planning Assessment, Vol. 30, pp. 2005-2024

[7]. Sakashita, A., H. Park, and T. Ichiki. (2006). The change of agricultural production system and land problems in the Sunan area of China: A follow-up research of Kaixiangong village. Review of Agricultural Economics, 62: 15-24.

[8]. Cheng, H. (2009). Institutions forecast continued recovery of the real estate market. Financial Net (in Chinese), March 23, 2009. Available at http://www.caijing.com.cn/2009-03-23/110126956.html

[9]. The Economist. (2007). Chinese Consumption. Available at http://www.economist.com/finance/displaystory.cfm?story_id=8746393. February 22nd, 2007 issue of the Economist magazine

[10]. Luo, Y. (2007). (ed.), China Industrial Map Editorial Committee, the China Economic Monitoring and Analysis Center of the National Bureau of Statistics, and Shanghai Yiju Real Estate Research Institute, The Industrial Map of China Real Estate. Social Sciences Academic Press: Beijing, China.

[11]. Fung, H., and Q. Liu. (2005). China’s Financial Reform in Banking and Securities Markets. Book chapter in China and the Challenge of Economic Globalization: The Impact of WTO Membership, pp. 145-163. New York, New York: M.E. Sharpe, ISBN: 0765614685.

[12]. Hang, X. L., Y. T. Huang, and H. Lan. (2008). A housing sale impasse for foreign institutions. First Financial Daily (in Chinese), October 23, 2008. Available at http://www.douban.com/group/topic/4461518/

[13]. Fung, H., A. Huang, Q. Liu, and M. Shen. (2006). The Development of the Real Estate Industry in China. Chinese Economy, Volume 39, Issue 1: 84-102.

[14]. Batson, A. (2009). China turns a corner as spending takes hold. Wall Street Journal, April 11, 2009, Page A1.

[15]. Feng, X. (2008). China’s Road to Good Housing. Shanghai Far East Publishing House: Shanghai, China.

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